(Corrects to add role of independent directors in fourth
paragraph of story published Dec. 20.)

Dec. 20 (Bloomberg) -- American Suzuki Motor Corp., the
U.S. distributor of Suzuki cars and motorcycles, will import
about 2,500 more autos to meet demand that jumped after the
company filed for bankruptcy with plans to end U.S. sales.

“When we told dealers, ‘We have one last chance,’ the
dealers said, ‘Go get them,’” M. Freddie Reiss, the company’s
chief restructuring officer, said today in an interview. “No
more cars are being manufactured” for the U.S. market, he said.

American Suzuki’s November auto sales rose 22 percent to
2,224 units, the company said this month. Dealers reported that
sales also climbed in December, mainly because of generous
incentives and a seven-year warranty program, Reiss said. Even
with the spurt in sales, the company still can’t justify staying
in the U.S. auto market, he said.

Last year, Suzuki Motor Corp., based in Shizuoka, Japan,
appointed two independent directors to the distributor’s board,
Reiss said in an e-mail. Those directors formed a committee that
put American Suzuki into bankruptcy Nov. 5 to end losses in the
U.S. market, avoid the costs of federal regulations and shut
down a sales network in which 69 percent of dealers sell fewer
than five cars a month.

The company will sell about 22,000 cars this year in the
U.S., compared with about 120,000 a year before 2008, Reiss
said.

Dealers will sell their remaining cars and continue to
provide parts and warranty work and other repairs, the company
said. American Suzuki plans to reorganize its motorcycle, boat
and all-terrain vehicle business and make sales through separate
dealers, according to court papers.

Motions Approved

Today, the company was in U.S. Bankruptcy Court in Santa
Ana, California, where it won permission for three motions
designed to help it shut down the auto-dealer network and
reorganize the motorcycle and boat business.

U.S. Bankruptcy Judge Scott Clarkson approved the company’s
request to borrow $50 million more in order to import the
additional cars from Suzuki Motor.

Clarkson also approved a settlement with dealers intended
to avoid litigation over the shutdown.

Suzuki Motor had asked its car dealers to voluntarily
cancel their existing franchise agreements in exchange for half
of what they are owed immediately and the rest through the
normal bankruptcy process, according to court papers.

American Suzuki owes its parent about $152 million,
according to court records. To help guarantee that dealers who
settled will be repaid everything owed to them, Suzuki Motor
agreed to subordinate that debt, according to court documents.

Affiliate Bid

American Suzuki also won permission to sell its motorcycle,
boat and ATV distributorship to an affiliate of Suzuki Motor for
$95 million barring a higher bid. Clarkson overruled an
objection from the U.S. Trustee, the arm of the U.S. Justice
Department that monitors corporate bankruptcies, which argued
that Suzuki Motor’s involvement would discourage competing
bidders.

The case is In re American Suzuki Motor Corp., 12-22808,
U.S. Bankruptcy Court, Central District of California (Santa
Ana).